Governor’s office previewed controversial PSC letter

By: Andrew Graham, WyoFile.com - Updated: 4 months ago

Posted Feb 5, 2020

The chairwoman of the Wyoming Public Service Commission sought the approval of Gov. Mark Gordon’s policy staff before sending a letter to federal utility regulators that subsequently drew criticism, documents reveal.

The letter sent by the Wyoming PSC and four other state’s utility regulators used language crafted by a coal industry lobbying group, a move that was picked up by national media and condemned by some environmental and consumer advocacy groups. Some state lawmakers defended the PSC in interviews with WyoFile.

In September, the PSC sent the letter urging the Federal Energy Regulatory Commission to accelerate an inquiry that could subsidize coal plants in the name of electrical grid reliability. Part of the letter copied language crafted by the American Coalition of Clean Coal Electricity.

The Sept. 12, 2019, letter signed by Public Service Commission chairwoman Karen Forstrom urged the FERC to act on the item that had languished on its docket since January 2018. In that month, FERC rejected a proposal by the U.S. Department of Energy to subsidize coal and nuclear power plants but agreed to examine the role of both power sources in grid “reliability and resilience,” according to the news site Utility Dive.

WyoFile reported on the matter in October after receiving documents from the Energy and Policy Institute. The documents outlined how three paragraphs of Fornstrom’s letter matched a model letter an ACCCE representative provided to West Virginia’s public service commissioners.

The Energy and Policy Institute subsequently provided WyoFile with more communications it received via records requests. The communications include emails by Fornstrom that show she waited for a nod of approval from Renny MacKay, the governor’s policy director, before sending the letter.

Fornstrom acknowledged the emails in an interview on Monday. “I’m a member of the executive branch and so I certainly don’t want to take a position, outside of our typical duties, that’s not the position of the executive branch,” she said. Writing a federal body to urge action on a national issue was distinct from the PSC’s regular duties overseeing public utility companies in Wyoming, she said.

A researcher with the Energy and Policy Institute said the exchange suggested undue political pressure on an economic regulator.

“Public service commissioners are supposed to focus on ensuring fair rates for electricity consumers, not to do the bidding of powerful and well-connected industries,” Joe Smyth said. “Political pressure on commissioners threatens to undermine the independence of the Public Service Commission and the important role it is supposed to play in protecting ratepayers.”

On Sept. 4, 2019, MacKay emailed Fornstrom a Politico article about the FERC’s fall agenda, where grid reliance would be discussed, according to the documents provided by Energy and Policy Institute.

“I have a draft letter to FERC on the grid resilience proceeding that I will get out before they reconvene on the 19th,” Fornstrom replied. “Do you want to look at that before I send it?”

MacKay agreed to look at the draft, but said “I am not asking to edit it.”

On Sept. 10, ACCCE CEO Michelle Bloodworth emailed Fornstrom asking for a copy of the letter.

“I can’t send it until I have approval from the governor’s office,” Fornstrom replied.

On Sept. 12, MacKay emailed Fornstrom that “I’m glad you will send this,” in response to receiving a draft. Fornstrom then sent the letter to the ACCCE CEO.

MacKay did not know that portions of the letter were drafted by ACCCE, he told WyoFile. Still, “we were aligned with ACCCE and want to make sure the coal industry thrives. We definitely feel strongly that FERC should consider [grid] reliability,” he said.

He did not know Fornstrom waited for his approval, he said. “I appreciated getting [the draft], but certainly no, I never believed whether my approval hinged on it,” he said on Monday.

Fornstrom, who declined to comment in October on the FERC letter, on Monday said her agency took “some proposed language” from ACCCE and made it “Wyoming specific.”

The PSC “looked at it, had an internal review and commented on it,” she said. Receiving draft language from an interest group is not unusual, she said. “Lobbying groups assist individuals and government entities in making comment in public dockets.”

Such proposed language comes from environmental groups as well as industry lobbies, Fornstrom said. It’s “not a new tactic,” she said.

The FERC incident comes as the Wyoming PSC begins an investigation into utility company PacifiCorp’s plans to transition away from coal power. State politicians are closely following the investigation, where the commission is also examining questions of grid reliability.

“We remain independent,” Fornstrom said. The commission will be hiring outside consultants to conduct much of the technical work of that investigation, she said. Those consultants will collaborate with the commission and its staff, per the contracting proposal.

Gordon supported the idea of the investigation, and his staff have touted it in public remarks as an example of action the state is taking to stem coal’s decline.

“The governor wanted that investigation,” MacKay said on Friday. “PSCs all across the country are getting involved in politics,” MacKay said, and “getting way more involved in policy. There is a lot of interference in the [energy] marketplace right now.”

The governor’s office, like the Legislature, is trying to sort out what the Wyoming PSC’s future role should be, he said.

“Nobody has changed the PSC’s mandate and we’re not interfering in that per se,” MacKay said.